Matter expands like “we all create a puzzle”

--First, please tell us about the features and benefits of Matter.

Shingai: First, the smartphones you own, such as iPhones and Android devices, are compatible with Matter by default. This is where the benefits of Apple and Google contributing to standardization lie. Plus, it's extremely easy to set up. All but a few Japanese home appliance manufacturers say that even if customers purchase connected home appliances, they often cannot connect them. Matter can solve that problem.

When users turn on Matter after purchasing a home appliance, a message saying "New device found" will be displayed on their smartphone, and they can connect it immediately by scanning it. Compared to previous wireless standards, the probability of being connected is quite high. Another feature is that security measures are included in the specifications.

Matter 's specifications are determined through a process involving three sub-working groups.

First, the MPSG (Marketing and Product Sub-Working Group) specifies use cases from the user's perspective.

Next, the TSG (Technical Sub-Working Group) will create technical specifications to make it a reality.

Finally, the CSG (Certification Sub-Working Group) performs test specifications and interconnection tests to obtain certification. It can be said that the specifications are determined from a user-driven perspective.

The one on the left is more like a cycle, and although it falls like a waterfall, it can also be said to be agile because the feedback that appears in the later processes is reflected.

I also participate in member conferences sponsored by CSA that are held regularly overseas, and I find that companies such as Apple, Amazon, Google, and Samsung have a fair discussion in order to create user-first products. I am.

--The elimination of vendor lock-in and improved convenience are also playing a role in the spread of smart homes.

Shinkai: Yes. Of course, I think the participating companies have a feeling that they want their products to sell, but looking at the conference, all of the companies have a feeling that they want the market to expand first. appears to be stronger.

For example, I would like you to think of Lego, but although Lego is not an open standard, it is made according to fixed rules. In the past, there weren't many types of Lego parts, but now there are countless parts that can be used to express various things. If Lego were to be an open standard, various manufacturers would be able to create Lego parts. I think it's important to set rules like this and say, ``Let's all decide the rules and let each company create unique puzzles.''​

The role of each hardware company is to determine what kind of features the parts will produce, but platform companies mainly compete in the software area. If we were to be able to move the assembled Lego, I imagine how we would use software to make it move using AI.

In the future, as the infrastructure called Matter expands, many things will be connected. At that time, I think the key points to consider are ``what kind of predictions should be made with the collected data'' and ``what kind of information should be provided?''

――With the advent of Matter, what changes have occurred in the strategy of real estate-related businesses?

Shingai: For example, in the United States, there is an accelerating trend for new homes to be equipped with smart homes as standard equipment. Therefore, I think that in two to three years, or even sooner, we will see houses equipped with Matter. Perhaps we will see a world in which home appliances that are difficult to add or change later are built-in, and residents are encouraged to buy and DIY the necessary items themselves.

--In the United States, sellers install smart home appliances such as lighting and air conditioners from the beginning.

There seems to be some data that shows that the final sales price of a home can be raised by 3 to 5%. Can something like this happen in Japan?

Shingai: That's right. In the United States, building a smart home increases the value of the property, so you can raise the rent. When I talk about this in Japan, some people react by saying, ``This is unique to America,'' but I think it makes sense if you imagine yourself looking for a property. For example, if a person is looking for underfloor heating or an automatic lock system, they will pay more in rent without any doubts if the property is equipped with such features. It's just a matter of adding smart devices such as smart locks.

--Certainly, it seems that new value will be created in real estate from the perspective of "smart home compatibility" in the future.

Other than that, what kind of impact do you think Matter will have on the market?

Shinkai: In one word, it's branding.

For example, in the past, the Wi-Fi and Bluetooth logos were not generally recognized, but now most people can recognize them just by looking at the logos. ``Things with this mark can be connected to the Internet or smartphones.'' Matter is, so to speak, the home version of that.

I think the CSA members probably consciously created it so that users would treat it that way. It may take some time, but if you look at it over a two to three year period, it will follow the same trend as Wi-Fi and Bluetooth.

Introduction of smart homes ahead of other countries, what are the challenges and solutions for Japan?

--What is the penetration rate of smart homes?

Shingai: The numbers include the introduction of smart home devices, but in America, which is relatively advanced, the rate is around 41 %, so there are still many people who are not interested. By the way, the sweet spot for purchasing smart home devices is said to be between the mid-20s and mid-40s. We support a variety of Japanese corporate clients, and many of the people in that age group are working with a passion that says, ``If we don't do something, we have no future.''

Although the current housing equipment in Japan is not much different from what it was 20 years ago, it used to be steadily evolving. For example, floor heating, dishwashers, washlets in toilets, etc. are now commonplace, but in the early days there were concerns such as, ``Utility bills will be high, a stove will suffice,'' and ``Water leaks under the floor or breaks. What should we do if we do that?'' people were saying.

Moreover, the common sense we have before the pandemic and now is already completely different. Many companies used to say, ``Remote work is impossible!'' but there are still many companies that are able to do it normally. I think that there is a common sense of the time, but I believe that what we currently think of as common sense is really just a temporary set of values and is constantly changing.

--What are your thoughts on the current state of smart home commercialization in Japan and its future trends?

Shingai: I think that in Japan, smart homes are still viewed as gadgets. Of course, there are similar aspects overseas, but it has become more of an infrastructure than in Japan, and is used to solve problems in daily life and property management, so it is also viable as a business. Additionally, there are still very few companies in Japan that view smart homes as gadgets and are promoting them as a business.

Representative overseas companies involved in smart homes include Samsung and LG in Asia, and BOSCH, Siemens AG, and IKEA in Europe. Other well-known players include Google, Amazon, and Apple. Start-up companies are also gaining more momentum than before, and compared to Japan, there are an order of magnitude more players.

In smart homes and IoT, the products that users actually see are hardware (hereinafter referred to as HW), so it is easy to misunderstand that the manufacturers are strong in this field. But in reality, software development accounts for much of product development.

This chaos map is divided into 12 categories, and you can see that various players are participating, such as non-life insurance companies, smart home appliances, and communication carriers.

The players inside the red dotted line are Japanese players, and the players outside of that are overseas players. The players between red and blue are overseas players who also have a presence in Japan. As shown in this chaos map, there are many categories of smart homes, and a wide range of industries are entering smart homes, so it feels like a mixed martial arts battle.

--Japan seems to be in a situation where collaboration between companies is difficult.

Shingai: That's right. The same goes for how products are made and the approach taken, and the speed of decision-making and commercialization is completely different between Japan and overseas. Overseas, we create our products with an eye toward openness so that they can be connected to various places, but in Japan, compared to other countries, there is a tendency to be more caged in. This is a factor that divides the pros and cons of Matter in Japan.

--In that case, many companies will have difficulty establishing themselves as a business. What kind of support does X-HEMISTRY provide in response to this current situation?

Shingai: As the number of companies that want to consider commercialization is steadily increasing, we are providing accompanying support. We believe that we need to consider our business from the same perspective as our customers, so as a first step, we provide a wide range of education programs ranging from basic knowledge of smart homes and related technologies to business models. It depends on the customer's circumstances, but we expect it to take about 3 months.

Once the project members are aligned, we move on to the business consideration phase.

However, we do not force our customers to go in any direction, including the products they use. This is because the direction in which we should proceed is a matter of synergy with the customer's business and corporate culture. We use frameworks to narrow down the business direction based on interviews, and provide support from PoC design to implementation in a variety of areas. Also, since it is important to create systems and structures that can be operated, we also provide advice on system design and organizational design from this perspective.

--I think there are many companies that are unable to take the first step because it is difficult to pass internal approval. Is there any countermeasure?

Shingai: I think the shortcut is to have people experience it first hand. We always tell our customers, ``Please create a lab, showroom, or other place where everyone can easily experience a smart home.'' For example, when it comes to smartphones, it is extremely difficult to verbally convey the benefits of something to someone who has never used it. However, if you show them the device and demonstrate how it is used, many people will probably be moved and say, ``Wow!''. PoC at project members' or employees' homes is also effective.

How to convey user experiences and use cases realistically is a very important point. Even among the customers we supported, there were cases where it was difficult to convey the benefits of smart homes to management. When we demonstrated how to move various things, people said, ``That's what you mean! That's interesting!'' and the conversation started to progress smoothly from there.

We also hold lectures specializing in Matter, and there is a huge demand for them, so we have held many lectures over the past year or so.

--It's difficult to convey the benefits of smart homes to management, isn't it?

Shinkai: Yes. Since I don't often have the opportunity to give lectures directly to management, I first emphasized to the project members that ``smart homes are not just gadgets, but business tools that can help solve problems in daily life.'' I hope you understand.

Significantly reduces the hassle of signing a rental contract Advantages of smart home security

--What kind of problems can a smart home solve?

Shingai: The current main areas are smart home security and smart apartments. Recently, there are access controls such as energy management, but the most popular area is smart home security, so I will talk about this in detail.

In America, like Japan, there has been a so-called home security business for a long time. However, the penetration rate remained at around 20 %, making it a non-growth industry. However, the situation has since changed with the advent of security systems that can be used on a daily basis, and the penetration rate has now increased to around 40 %.

When I talk about this, some people say, "Isn't that because it's America? Isn't there a need for home security products in Japan because it's so safe?" However, doors with two locks are actually only found in Japan, auto-locking apartments are popular, and there are cameras in the common areas. And properties like this are popular. In other words, Japanese people have a high level of security awareness. By the way, in a past survey on home security, one in two people answered that they were ``concerned about their home and family.''

Also, while home security in Japan often has the image of a security guard protecting the home, it is interesting that in America it is the exact opposite, with an emphasis on coolness. In addition, a promotional video by a major American home security company shows users installing the equipment in a DIY manner, giving it the feel of everyday use.

In the United States, home security used to be the norm, with a security guard monitoring your home when you were away or at night. However, monitoring using a smartphone is not possible, and the initial cost is high and running costs are high. As a result, only the wealthy could use it, and the penetration rate remained at 20 %. By the way, in Japan, there is a reason that it is safe, but most of the services are difficult to feel like they can be used in daily life, so the penetration rate is still only around 3 %.

On the other hand, home security using smartphones has many devices, so you can feel secure that you are always connected to your home. You can also expand the functionality and update the software. Although it appeals to a completely different demographic than traditional home security, I think there are many people who would pay for it. This is not a gadget, and it solves the problem of worrying about your home and family. This is the current worldview of home security.

--Is the increase in demand for home security in the United States due to the increasing popularity of smartphones?

Shingai: That's right. Smart home security began to emerge in the United States around 2010. In the early days, Japanese security companies and cable communications companies entered the market. Just after the iPhone and Android were introduced, interactive services began to be created that let people feel connected to their homes using their smartphones.

After that, major companies began to enter the market and started running a lot of advertisements, which led to an increase in awareness of smart home security. 2010 can be said to be a particularly symbolic year for home security.

Furthermore, around 2014, companies such as Amazon, Google, and Apple also entered the market, and as soon as products appeared on store shelves, they began to sell rapidly. Then, housing manufacturers saw this and started implementing smart home security as standard, thinking, ``Maybe we should standardize this?'' Also, from around 2019, multifamily housing manufacturers have also joined the group. As I mentioned earlier, introducing a smart home increases the value of the property, which also benefits the management company.

--In America, smart apartments have become commonplace.

Shingai: That's right. The main functions include smart locks, air conditioning, lighting, and intercoms. Smart apartments also have benefits for both customers and management companies when signing contracts. For example, in the case of a private viewing in Japan, you first search for a property on a property website, then if you find a property you want to see, make an appointment, the management company obtains permission from the landlord, and a salesperson comes along on the agreed day... ...and you have to go through quite a few steps to get to your room.

When this is turned into a smart home, tenants can use their smartphones as keys, allowing them to view the property right away. What's more, you won't be under any pressure from the salespeople who normally accompany you. You can turn on the air conditioner and lights as you like, and in the summer, if you turn on the air conditioner before you arrive, you can enjoy a comfortable tour. Even if you forget to turn it off, there is no problem as the management company can easily control it remotely.

Best of all, you don't have to pick up the keys, so if the tenant likes the room, they may be able to move in the same day. This will significantly shorten the period of vacancy and reduce operating costs. What's more, the value of properties is increasing due to smart technology, and I think there is a high possibility that future generations of young people will be looking for properties like this. In this way, if you view smart homes as something that can solve problems, I think everyone, including corporate executives, will see a variety of benefits.

By creating a solution, the motivation of the buyer increases, which in turn increases the motivation of the person who commercializes it. We are supporting efforts to create this flow.

Can Matter be popularized in the near future?

--I've heard a lot of things, but do you think Matter will be popular all over the world within five years? Also, what do you think about the possibility of another standard emerging?

Shingai: I think it's definitely becoming popular, including in Japan. For example, the iPhone and foldable smartphones were also controversial when they were first introduced. However, technology evolves, and after three to four years it will become commonplace, and even if something was difficult to use in the beginning, it will become usable. I also think that once it becomes compatible with network cameras, it will be able to be used for a wide range of purposes, such as monitoring the elderly, so it will become more popular.

I don't think there will be another standard for Matter. Even if a group were to come out to compete with Matter, they would ultimately have to act in the same way as Matter, while considering various things such as use cases and security. I also think it will be difficult to gather major companies and people who are committed to smart homes and who will buy in. In this field, the most important thing is to get the manufacturer's buy-in, so it would be tough if we got stuck in that area.

--How would you like to proceed with business as X-HEMISTRY in the future?

Shingai: We believe that we are the consultants with the most experience and know-how in smart homes in Japan, so we would like to continue to collect primary information overseas and update it as we expand. .

If you are considering commercializing a smart home, please feel free to contact us with questions such as ``What is a smart home?'' and ``What kind of business models are there?''